It sounds to me like the issue may be that you're crowding the pan.
Basically, to get everything nice and brown and crispy, you need enough space for all of the steam to escape. That picture you showed has potatoes stacked on top of each other -- that means as the bottom items cook, they're going to end up steaming the items above them.
At a diner, they have a large griddle to work with -- they can really spread things out. You're not typically that lucky in a regular kitchen, as you don't have as much space, and you have a lip on the pans that'll hold the steam in.
So, either work in smaller batches, or consider recipes that use an oven -- using sheet pans instead of a pan on the stove solves much of the problem.
One other trick is that most diners don't start from raw potatoes -- maybe with hash browns, but not for home fries, you're not going to get the nice soft interior in a reasonable amount of time unless you start with a potato that's already been baked or boiled. (If you're doing things in the oven, you might be able to, but not in a pan)
Just for reference ... I have a 14" cast iron skillet that I use for home fries ... and it's about the right size for cooking a single large potato, which might be two servings, maybe three for kids. (I tend to cook carb-heavy meals).
update : I probably should've stated this directly -- you want the chunks of potato to form a single layer in the pan, with space in between them.
There's too many factors to have a set percentage of oil that will stay, but lets cover a few common things that determine the oil in your final product.
Heat of the oil:
- Your oil needs to be plenty hot enough to actually fry in. For fries, you'll typically want to shoot for between 350-375 F. If you don't have a thermometer, then get one! If you really don't want to get one, a white bread cube will fry brown in about 60 seconds at the right temp - but a thermometer is best. If the oil isn't hot enough to fry in, it will start to absorb the oil. So before you ever fry anything, get that oil up to temp (and make sure its that way between batches!).
Coating of the fry (or other fried food):
- A batter coating is just going to hold more oil than a plain french fry. If you're trying to be health conscious about french fries (but then again, why are you eating french fries!?!), avoid batter coating them and go with a 'plain' fry.
Post frying treatment:
- Shake, shake, shake! Give the basket a good vigorous shake. Don't have a basket? Use a strainer or at least a cooling rack with a mesh-type grate. You're trying to physically shake as much oil off the fry as you can. Additionally, I like to lay them on paper towels and then fold the paper towels on top. See all that oil? Simple math, if its on the paper towel, its not in the fry anymore.
Crowding the pan:
- If you crowd the pan you fry in, you'll lower the temperature of the oil and give the oil not enough circulation. This means longer to fry and more time not at the right temperature. This means more oil in the final product. Its better to do some smaller batches than to try to cram it all in one batch.
The right oil:
- The main thing here is that you need an oil that can fry hot enough without smoking. This goes back to the right temperature. (In case it hadn't sunk in yet, temperature is important!) If you can't get it hot enough, then you're going to absorb a lot of oil. Olive oil is a bad choice. I usually use peanut or canola oil.
Best Answer
Adjustment A: You're not going to see much difference from this method, because there's not going to be much heat transfer. One of the key parts of frying is oil contact, because the oil transfers heat at a very quick rate, and gets into all the tiny surface nooks and crannies, so more of it gets cooked at the same rate. If you're just pan cooking without (or very little) oil, aside from a relatively tiny bit of radiant and convection heat the only cooking will happen where the surface directly contacts the pan.
Summary: You'll need to turn every french fry, to every side, and even then the cooking won't be as uniform as you'd like, even if you do it perfectly.
Adjustment B: Baking means your getting good convection, but that also means you may be drying out the fries a bit, especially after they've already been in oil and lost some moisture. Baking might be a better addition, but I'd avoid it as a last step. You'll also be letting your oil that's on the fries, soak in a bit more, so they may be dry... yet still greasy.
Summary: They'll end up like reheated fries because... that's pretty much what you're doing.
My suggestion: Boil or steam the fries (not too much!) to start the inside starches cooking and getting "fluffy". Let them dry and cool a bit. Then hit them with a shallow (or ideally deep) fry to crisp up the outsides, but not have to sit in the oil long enough to burn or soak up the oil. This also would work with prebaking for what it's worth, but you may still get the drying. Just depends on what you're going for.